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Ivorian fintech Zulaya gets $5M to become banking partner for businesses in Francophone Africa • Technology Flow

Ivorian payments-led fintech startup Zulaya has extended its pre-Series A round to $5 million. The company, which facilitates B2B payments for businesses in Francophone West Africa primarily through mobile money channels, has raised a total of $7 million in a financing round.

In 2019, West Africa reported the highest number of live mobile money services of any region with 56 million active accounts. In Ivory Coast, one of Francophone Africa’s largest mobile money markets, 75% of the population has a mobile money account, compared to 20% with bank accounts. That’s why Zulaya launched its services in the West African country and has since expanded into Senegal, where mobile market penetration is around 80% as well as mobile money among other countries in the UEMOA (West African Economic and Monetary Union) region. Usage

Small and large enterprises in these countries can use the Zulaya platform to make bulk payments to other businesses and their unbanked employees through existing mobile money channels. But they can now access more services, such as a startup prepaid card — issued by MasterCard — for corporate expense management. The cards are designed for businesses to easily import travel requirements, other online expenses and transactions into their accounting systems, the CEO said. Matthias Leopoldi told Technology Flow in an interview.

“Our concept or strategy with the cards is to offer a full range of services. Because if you just have cards, I don’t think you can build a great startup with as much traction as you want, for example, in the US,” says the chief executive who founded the company. Charles Talbot. “Except in South Africa, maybe Nigeria and a little bit in Egypt, the card payment industry is thriving and even if you can grow a business on it, it is almost impossible in our region. [Francophone Africa].”

Leopoldi notes that offering cards — most of which are physical (on clients’ requests) — is not a key strategy for Julaya in terms of revenue growth. It’s the switching cost strategy that, according to him, differentiates the fintech from competitors like the YC-backed, which see cards as the main driver.

More than 40% of Julaya’s 500 small and medium businesses (SMBs), startups, large corporates and government organizations use its corporate expense management feature. Although the most significant volumes come from medium to large enterprises, fintech has surprisingly seen greater adoption from its traditional and non-digitalized smaller clients, Leopoldi commented.

Over the past year, the Ivorian-French startup has also expanded its range of products to include a “Cash & Collect” solution, which enables “fast and secure” cash collection, especially in the FMCG sector. Here, businesses can deposit their cash from physical and field sales into their Julaya account through a mobile money agent branch without visiting a bank.

Last July, Leopoldi said the fintech was processing more than $1.5 million monthly. Those numbers have grown fivefold to more than $7.5 million, with revenues seeing like-for-like growth of over 500% year over year. Brands like Jumia and Sandy are some of Julaya’s clients.

July

Image Credits: July

European venture capital fund Speedinvest led Zulaya’s pre-Series A extension round. EQ2 Ventures, Kibo Ventures, angel syndicates Unpopular Ventures and Jedar Capital, existing investors Orange Ventures, Saviu, 50 Partners and Ivorian business angel Mohamed Diaby and professional football player Edouard Mendy also invested in the round.

Mendy’s participation – his first in Africa and second globally – spotlights the growing involvement of athletes in Africa’s venture capital scene. This week, Technology Flow featured Build Ventures, a $15 million fund targeting African fintechs. A striking observation from the news is the number of players involved as limited partners of the firm; Some have invested directly from various reports. Mendy is African, unlike others who are mainly Europeans. While he is one of the first African athletes to support startups, Leopoldi predicts there will be more examples in the future.

“I think he’s a little bit ahead of the curve. We’re seeing football stars or high-net-worth individuals in the sports industry starting to look at investing in venture capital for two reasons. First, even though it’s a risky asset, it brings great returns. And second, they want to invest in venture capital. Their image should be used to show that they don’t just care about the sports career, but want to inspire their country. It makes sense for Edouard Mendy, because he is Senegalese.”

Julaya also received investment from its CFO and Country Manager in Senegal. Proceeds from this financing round will help the fintech in further expansion plans across Francophone West Africa, as it plans to open offices in Benin, Togo and Burkina Faso, hire talent and ramp up product development.

Enrique Martinez-Hausman, principal at lead investor Speedinvest, said the firm’s portfolio company is changing how businesses operate in the complex payments landscape in the Francophone, which also includes players such as Cinetpay and Bizao. As we look forward, Julaya’s technology will extend beyond its payment capabilities, with the potential to become the closest banking partner for companies in West Africa,” commented Martinez-Hausman.

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